McArthur raises "inherent unfairness" of energy standing charges

Orkney's MSP, Liam McArthur, has called out the inherent unfairness of standing charges for rural and island communities' following recent price cap rises.

Speaking during Net Zero and Energy Questions yesterday, Mr McArthur highlighted that Ofgem's price cap rise in April saw a 1p per day increase in standing charges for gas whereas electricity almost doubled to 45p per day. This has led to off-gas grid areas such as Orkney, already subject to higher energy costs, facing a further disproportionate rise.

Orkney's MSP went on to explain that to add insult to injury households in the Highlands & Islands are now picking up the tab for bust energy companies, many of whom were unable to serve the region due to the restrictions applied to those on Total Heating Total Control meters.

Mr McArthur drew attention to the work of Highlands & Islands Housing Associations Affordable Warmth Group (HIHAAW) in analysing the growing disparity In costs and urged the Cabinet Secretary, Michael Matheson, to engage with HIHAAW Chair, Di Alexander, ahead of making representations to Ofgem and UK Ministers. In response, Mr Mathison agreed that the current energy market was "penalising remote and rural communities" and offered to follow up with HIHAAW.

Commenting afterwards, Mr McArthur said:

"As an off-gas area, Orkney is far more reliant on electricity as well as heating oil. The wildly disproportionate rise in standing charges for electricity as opposed to gas has therefore compounded the problem of high energy costs for islanders.

"Ultimately, this is a decision for Ofgem and the UK Government.  I have worked closely with HIHAAW Chair, Di Alexander, to expose the ever-increasing divide between dual-fuel and off-gas areas and make the case to UK Ministers and the regulator for the social and environmental cost levy applied to bills to be equalised across gas and electricity bills.

"I hope the Cabinet Secretary will now work with HIHAAW and lend weight to these arguments in his own discussions with his UK counterparts and Ofgem. Along with introducing a cap on heating oil, levelling out standing charges would deliver greater fairness and go some way to tackling the sky high levels of fuel poverty in our island and rural communities."